This post is not legal advice
Earlier this year, Ashley and I posted about issues for landowners to consider before signing a solar energy lease. One such issue to consider was whether solar power development is allowed if the land was in a land preservation program. In many cases, the terms of the easement preserving the farmland may not authorize commercial solar power development. The Maryland Agricultural Land Preservation Foundation (MALPF) over the summer announced final regulations to allow limited commercial alternative energy development on MALPF-protected farmland. Commercial alternative energy development will be limited to solar, the wind, and anaerobic digestion of poultry litter or livestock manure.
New MALPF Rules
To get MALPF’s approval for commercial alternative energy development, the landowner, and the project must be eligible (§ 15.15.14.03). The project needs to conform to all applicable federal, state, and local laws and all zoning requirements. The proposed facility must also occupy either five acres or no more than five percent, whichever is less, of the easement area. The proposed facility must also hold a contiguous area and not multiple spots in the easement area. The landowner and the owner of the facility must agree that MALPF inspectors may enter the area during regular business hours. The project owner or the landowner must sign a bond for MALPF to ensure the removal of equipment and the land restored at the end of the project.
With anaerobic digestion, the generated electricity can only be from poultry litter or livestock manure which must originate from the farm subject to the easement. Anaerobic digesters can only be located on fallow land and not land currently used for production. Any effluent storage areas needed to produce energy will be considered a part of the five acres, or less than five percent of the easement area.
To be reviewed by MALPF, the landowner must seek approval before June 30, 2018, and the MALPF board will no longer approve applications after June 3, 2019. The application for approval will require materials from multiple sources, found in § 15.15.14.04. Landowners seeking approval should contact MALPF to understand the process better.
MALPF will consider approving the commercial development when the alternative energy development allows the maximum agricultural use of the preserved land. The proposed project cannot negatively impact the agricultural use of the farm beyond the approved area. The proposed project may not affect drainage, flood control, erosion control, forest stewardship, water conservation, or soil conservation on the preserved farmland. The project cannot locate on USDA soil classes I, II, or III or Woodland Groups 1 and 2 without sufficient justification. The approved area for the project cannot create smaller fields which become isolated or no longer have agricultural uses.
If the development is approved, the landowner will be required to record an agreement with the deed and easement to bind future landowners. The landowner and the project owner shall pay both the costs to modify the easement and an annual fee to reimburse monitoring and enforcement costs.
The landowner must pay MALPF annually for five percent of any payment made to the landowner for the commercial alternative energy project. For example, let’s say the agreement between the solar energy operator and the landowner is to pay the landowner $1,000 per acre per year. The solar energy facility takes up four acres of land. The landowner would receive $4,000 annually, and $200 would go to MALPF annually.
At the end of the project, the landowner must remove the equipment from the preserved property and returned the property to productive farmland. MALPF can require the landowner or solar company to put up a bond to return the farmland to original condition if the project owner does not.
Solar companies are considering Maryland for energy production for a host of reasons. These final regulations from MALPF will allow many preserved landowners with MALPF easements to consider solar energy development while at the same time minimizing the project’s impact on agricultural production on the preserved farmland.
For those of you with farmland preserved under an MALPF easement, reach out to MALPF to fully understand how this approval process will work before signing any agreement. For those of you with preserved farmland with an easement held by another entity, check with that entity to determine if commercial alternative energy development is allowed. In many cases, commercial alternative energy development may not be allowed but if it is, the landowner needs to work with the easement holder to confirm the commercial development to terms the easement holder can handle.